Component suppliers might not be in for a good time financially speaking as it has been reported that branded handset vendors are reducing orders – among them include Nokia, Motorola Mobility, Samsung Electronics, LG Electronics, Sony Mobile Communications, RIM, HTC, Huawei Device and ZTE. Now this is quite a notable list of “Who’s Who”, and this amount of reduction is expected to increase all the way into the third quarter of the year. Economically speaking, this is not a good sign at all, as there is also the slowdown in purchase activities across Europe that is part of a double whammy in conjunction with a slowdown in growth momentum for smartphones throughout North America.
The range of reduction is anywhere from 5% to 10% for vendors who decided to drop their orders in a small scale, although there are some vendors who have reduced their future inventory by as much as 20% to 30%. Having said that, it would seem that the traditional peak season for component suppliers in the third quarter will be a miss instead of a hit for the year. Here’s hoping the next generation iPhone will be able to pick things up.